3Com to exit large enterprise networking

3Com is getting out of the large enterprise networking market to concentrate on small and medium businesses, home users and service providers.

3Com is getting out of the large enterprise networking market to concentrate on small and medium businesses, home users and service providers.

Last week California-based 3Com announced it will discontinue its CoreBuilder LAN switch line as of June 30 and transfer the technology to US-based Extreme Networks.

Extreme will provide a "migration path for existing CoreBuilder customers" by merging Core-Builder pro- ducts into Extreme's Summit and BlackDiamond lines of broadband network switching equipment, 3Com says. But 3Com vows to continue support and engineering services for existing CoreBuilder customers.

3Com Australia/New Zealand managing director Archie Wilson says New Zealand customers will not be affected as all local sites fall into 3Com's definition of an SME (1000 users or less) and are not enterprise sites.

"As [customers] look to upgrade they would be candidates to move to 3Com's new Switch 4000 product line. It's really only very large enterprise customers who would move to Extreme Networks."

Wilson says the Switch 4000 product range will enable users to stay with Fast Ethernet or move to Gigabit Ethernet over copper.

3Com will also cease shipment of its Path- Builder and NetBuilder WAN products by June 30. Most of these products will move to Motorola and 3Com and officials say customers of discontinued products will continue to receive service for up to five years.

In addition 3Com will transfer its analog modem business, which it acquired with US Robotics, to a joint venture to be set up with Accton Technology, a network switch manufacturer in Taiwan.

Although 3Com is moving out of core networking for large enterprises it will continue to provide LAN products for small and medium size companies. Home users and service providers are other target markets.

Local 3Com customers at the high end of the market include Auckland University, Mighty River Power, Te Papa, North Shore City Council, Department of Conservation and Telecom.

Spokesmen for Mighty River Power and Te Papa say they don't think they will be adversely affected by the announcement.

Wilson says the local operation was already focused on the SME and service provider markets and the seven-person New Zealand office will not be reducing staff.

3Com is distributed in New Zealand by Tech Pacific and Renaissance, while Christchurch-based Insite Technology distributes US Robotics products.

General manager of Renaissance Paul Johnston, says the move affects less than 2% of Renaissance's business and he is pleased that 3Com will become more focused on the products Renaissance sells more of. 3Com product manager, Robert Collins for Tech Pacific sees the announcement in a positive light as he believes it will focus and streamline 3Com's product range. Collins says he doesn't think the move will affect Tech Pacific as the Corebuilder range accounts for a very small percentage of distributors business in New Zealand.

In terms of revenue 3Com was number two in the New Zealand LAN market in 1999, with 14% market share behind Cisco with 66%.

IDC New Zealand general manager Dinesh Kumar says he doesn't see the announcement having much effect on the local operation, "given that they have never been that strong in the high-end of the [New Zealand] market. Historically if you said small business, people would normally associate 3Com with that part of the market."

  • See interview with Archie Wilson in this week's Friday Fry-Up

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